Australian gold miners making hay while sun shines on sector

The Australian gold sector is in great shape in comparison to its global peers because money talks, according to Evolution Mining boss Jake Klein.

Mr Klein said the Australian sector was making money and doing a better job of delivering value to shareholders than some overseas peers, and that was creating opportunities to acquire assets in North America.

Evolution and other ASX-listed gold producers are now waiting for the dust to settle on Barrick Gold's decision to shelve a hostile $US18 billion ($25.4 billion) bid for Newmont Mining.

Barrick boss Mark Bristow had made it clear he intended to sell off Newmont assets in Australia if the takeover went ahead, but instead the world's two biggest gold miners have agreed to form a joint venture in Nevada.

Evolution, Northern Star and Newcrest were on the short list of Australian companies thought to have been lining up to have a crack at Newmont's three local mines, producing a combined 1.8 million ounces a year.

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Mr Klein said it was too soon to speculate on the future of the Kalgoorlie's Super Pit, a joint venture between Barrick and Newmont, and the Newmont owned-Boddington and Tanami mines.

Mr Birstow had said the Australian mines did not fit in his plans from a merged Barrick and Newmont, but Newmont remained silent on the issue.

PCF Capital managing director Liam Twigger, who has been enlisted by Newmont for previous mine sales in Australia, said the Newmont assets were first-class.

He expected continued speculation about the future ownership of the Super Pit because of the joint ownership structure.

PCF has an indicative valuation of $US1.5 billion to $US1.8 billion on a 100 per cent sale and would expect strong interest from Australia's cashed-up mid-tier gold miners.

Mr Twigger said he expected to see Australian producers pick up more assets in North America, partly because their stock was so strongly valued compared to that of overseas peers.

"Valuations are up and so their paper is strong and at a premium," he said of the miners listed on the Australian Securities Exchange. "Valuations in Australia are the best in the world and probably have been the strongest in the world for the past 18 months.

"That is something we haven't seen since I've been around. There had always been a premium on valuations in North America just through the sheer weight of money chasing a home in the gold sector."

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Mr Twigger said the big Australian players had made better choices in employing capital and were reaping the rewards.

Newcrest has said its $US806.5 million ($1.115 billion) acquisition of 70 per cent of the Red Chris gold-copper mine and surrounding tenements in Canada's British Columbia provided a beachhead in North America and access to a broader investor base.

Bill Beament-led Northern Star went north to Alaska with a $US260 million acquisition of the Pogo mine in August and Evolution and St Barbara have made it clear they are interested in North American assets.

Mr Twigger said he expected to see more cherry-picking of North American assets.

"I think the Australians have been very smart. There have been no heroic corporate deals and they can pick plums out of the North American market on an asset basis," he said.

"They are cashed up and there is limited opportunity in Australia because the assets here are well valued."

Mr Klein said his impression from a big mining conference in Florida last month was that there was no universal investor support for the Barrick takeover offer for Newmont, but there was unanimous agreement that the synergies between the two companies in Nevada had to be realised.

"I think what investors are saying is they want the gold sector to do better and they want it to be more disciplined," he said.

Mr Klein said Australian gold miners were doing things well and chief among them was making money.

"We are doing well with regard to focus, we are delivering, we bought well during the down cycle and so, on a relative basis, Australian gold companies have a lot to be proud of."

The development of alternative supplies of critical minerals, as well as other joint efforts by Australia and the United States to address Chinese influence in the region, will dominate talks in Washington.